LOS ANGELES--As the booming game industry seeks to become the dominant entertainment medium, it's tottering between appeasing its loyal hard-core audience and targeting neglected groups such as women.

"We need a cultural shift so that young girls and women feel that playing games is not a testosterone-monopolized hobby reserved for their boyfriends and husbands," Douglas Lowenstein, president of the Entertainment Software Association, said Wednesday during a press conference at the Electronic Entertainment Expo.

Statistics, Lowenstein said, indicate that the industry has done a good job meeting the needs of its key group--men between 18 and 34 years old. But women and older adults still haven't grasped game play as eagerly as their male counterparts. "Somewhere between online checkers and 'Halo' is a sweet spot that the industry has to tap in order to significantly grow its market," said Michael Gartenberg, an analyst with Jupiter Research.

The game industry's struggle to reach underserved markets has left many people with the impression that games, like professional wrestling, simply aren't mainstream entertainment. That perception, however, has gradually changed as the industry has grown to a point that some now suggest it will become bigger than the better-established movie industry.

Including hardware and software sales, the game industry has overtaken box office movie sales. But counting DVD movie sales and rentals, as well as other merchandise related to movies, such as toys and clothing, the $48 billion movie industry far outpaces the $28 billion game industry.

Manufacturers of the much-touted next-generation consoles--Microsoft, Nintendo and Sony--announced this week that they have included features such as video chat; backward-compatibility to older, mainstream arcade video games; and online commerce features, in part to attract underserved groups to their new systems.

It's not that women are totally excluded from the game industry; ESA data indicates that they make up a third of the console market and about 40 percent of the PC game market.

"But we also know that many of these women are casual gamers who might invest more time and dollars into this form of entertainment if we produced content they could more easily embrace," Lowenstein said.

Frank Gibeau, senior vice president of American marketing with game publisher Electronic Arts, said new console features may improve the devices' chances of reaching the mass market. But console makers

need to do more to help game developers and publishers, he said.

"They have given us the technology but not the market," Gibeau said. "They must put those boxes in the hands of women and older adults."

But he acknowledged that penetrating those underserved markets won't happen overnight.

"If you look at boys and girls today, many of them are avid gamers," Gibeau said. "And our research has shown that people do not let go once it is in their blood."

Still, the number of U.S. households with game consoles has remained stagnant--in the 40- to 45-percent range for the last few years, according to research company IDC.

From a financial standpoint, market growth matters now more than ever.

With the new consoles, game development costs will significantly increase, analysts, developers and console makers believe. To alleviate that burden, the industry needs to increase the size of its audience and services around the game consoles.

Online multiplayer games, such as "EverQuest," are another segment many have been waiting to see take off. These games require players to pay a monthly subscription fee, as well as buy the game itself, potentially extending the profit-making life of a title substantially.

Nick Yee, a doctoral student at Stanford University, has spent more than three years studying demographic and behavioral trends in "EverQuest" and other massively multiplayer online games.

Over the past three years, he's seen little fluctuation: The female population of massively multiplayer online games has stayed steadily between about 12 percent and 16 percent of total players, he said. Average age has consistently been about 26 or 27 years old. Players have averaged between 20 and 23 hours of playing a week.

"On the gender ratio, science-fiction-themed games have fewer women than medieval-themed games, which do a little better," Yee said.

Leveraging other popular entertainment markets represents another strategy for pushing games into the mainstream. Historically, movie studios in particular have invested in and worked with game developers. More recently, there has been even more of a concerted effort to work together and share in the revenue.

"We expect there to be an explosion in the continued convergence of music, movies and games," said Philip O'Neil, Vivendi Universal's chief operating officer and president for North America.

Vivendi has previously based games on mainstream movies, such as "Hulk," and plans to do so in the future, with "Scarface," as part of an effort to reach the mass market.

The company will also use recording artists, such as 50 Cent, to drive game sales.

Despite these challenges, the market remains on a roll.

"Twenty-eight billion in global revenue isn't too shabby for a 30-year-old industry," Lowenstein said, "and the outlook for continued growth is extremely rosy."

John Borland reported from San Francisco and Richard Shim reported from Los Angeles.